According to a survey of 500 financial advisers conducted by the Life Insurance Customer Group (LICG), almost 90 per cent of AFA members strongly disagreed with LIF reforms and failed to find any consumer benefits from the proposed legislation.
“Over 550 of the total 2,336 LICG signatories are AFA members, a figure which shows significant discontent with the LIF outcome,” an LICG statement said.
“These signatories joined LICG to express dissatisfaction with the LIF reforms. The overwhelming number of adviser submissions to the Senate Economics Committee Inquiry into the LIF further highlights substantial adviser dissatisfaction.”
Yesterday in ifa, AFA chief executive Brad Fox said that the association had received “resounding support” from its members, while the FPA said that member satisfaction was on the rise.
The LICG was set up last year in an attempt to prevent the LIF from moving forward and is made up of a number of prominent industry identities, including director of dealer group Now Financial Group Mark Dunsford; Bombora Advice head Wayne Handley; Life Insurance Direct chief executive Russell Cain; Empire Risk director and senior adviser Daniel Isenhood; GJO Financial Services CEO Greg Owen; and Lambert Parkhill Financial Group managing director Ron Lambert.
In a meeting held yesterday in Sydney, the group moved to keep working on ways to ensure consumers continue to have choice, ensure all Australians have access to affordable protection, and make sure consumers have adviser support to ensure their claims are paid.
“No identifiable consumer benefit has yet been established by government or industry participants in the LIF reforms. It is this critical issue which lead to the formation of the LICG to ensure that the consumer was actually represented in this debate,” an LICG statement said.
[quote name=”Gerry”][quote name=”Chris”]Be very careful what you wish for. Read the signs, the FSC and ASIC are gunning for Level. Be careful, you don’t create a self fulfilling prophesy.[/quote]
I’d back that. Any blemish from here on will be used to nail commissions right down or even take them out in entirety. ASIC doesn’t like us, they where humiliated at the senate enquiry. Prepare yourselves for NIL commission.[/quote]
Good one Gerry, trying the BS that things will be worse instead of fighting to make things better.
And for me it still comes back to the quote above – “no identifiable consumer benefit has yet been established…..”
The press should be asking the politicans and the FSC, if there is no consumer benefit, who is benefiting? And why is this happening in the first place?
#noconsumerbenefit #whodoesbenefit?
I tried to email the AFA as a member 3 times with discontent about LIF reforms. I got ZERO replies.
[quote name=”Robert Coyte”]In refernce to being happy because the alternative was “worse” is a classic scare campaign strategy. Trowbridge recommendations were never going to come in.
In any case you fight because what you believe in is right. You definitely do not fight because you might lose.[/quote
Agree 100%, arguing that outcomes would have been worse is BS, AFA and FPA DID NOT represent advisers, they just tried to sell bad policy and decisions to us, saying the alternative is worse. The alternative is to have LICG represent US as they do.
[quote name=”Mark Harris”]Thank you LICG if only your members where to be elected to the board of the AFA maybe then we will have true representation of the advisers. Keep up the good work![/quote]
Agree 100%
[quote name=”Chris”]Be very careful what you wish for. Read the signs, the FSC and ASIC are gunning for Level. Be careful, you don’t create a self fulfilling prophesy.[/quote]
I’d back that. Any blemish from here on will be used to nail commissions right down or even take them out in entirety. ASIC doesn’t like us, they where humiliated at the senate enquiry. Prepare yourselves for NIL commission.
If it is true that Brad Fox said AFA chief executive Brad Fox said that the association had received “resounding support” from its members,
He is not talking to me or any other members I know from the AFA Just shows how completely out of his depth he is . Brad you can call me any time to discuss my dissatisfaction
Chris,
Your concerns regarding the continued lobbying efforts are quite reasonable. One of the reasons that I continue to strenuously object to the LIF is because this is the precursor to the killer punch that will be delivered by the FSC in 2018. Aside from the fact that they announced their intentions to push for a Level Commission and ultimately a fee for service model in a press release in November 2015, simple arithmetic suggests that if lapse rates improve and they are paying out 20% per annum in trailing commissions, their profitability will be impacted which will add further fuel to their ferocious appetite to reduce their cost of sales. To use a basketball analogy, it is the alley-oop before the slam dunk.
I agree with you that the forces behind the remuneration clampdown are strong, however, there comes a time where we need to stand up and say enough. We are an important partner of Government in the work we do. The investment and retirement planning advice we give reduces the reliance on the Aged Pension, the wealth protection advice we give reduces the strain on sickness benefits as we transfer the financial risk from the public sector to the private sector via the mechanism of insurance. We are willing partners in taking steeps to increase the trust and confidence that consumers have in financial advice, however we need to be recognised as Partners by all the stakeholders rather than carpets to be walked all over. The time has come for the majority to stand up and say enough, enough of the majority being punished for the sins of the minority. The advice sector is a cornerstone of the financial system and demands that the Government, ISA, FSC, Fund Managers and Insurers treat us as such. The LIF just happens to be the battlefront at this point in time. This will play out in other areas in time to come.
Regards, Sam
In refernce to being happy because the alternative was “worse” is a classic scare campaign strategy. Trowbridge recommendations were never going to come in.
In any case you fight because what you believe in is right. You definitely do not fight because you might lose.
LICG, intensions maybe well intentioned(I think, unless they are trying to say 100%+ upfronts should be retained), however they are miss guided.
Am I happy with the LIF out comes?Of course not, will I stop writing risk?Of course not. Do I blame the AFA/FPA? Absolutely not!
Did they negotiate comms down from 100%+ to 80/70/60? Did they negotiate a one year responsibility period up to two years? NO.
Here’s what was on the table, the treasury report recommending 30% and Trowbridge!The AFA/FPA negotiated a better outcome than we were facing.
I am a risk writer and will not back LICG, you are miss guided and risk doing more harm than good. Your anger is directed at the wrong people. Look to your left and the vested interests of the FSC.
Be very careful what you wish for. Read the signs, the FSC and ASIC are gunning for Level. Be careful, you don’t create a self fulfilling prophesy.
Thank you LICG if only your members where to be elected to the board of the AFA maybe then we will have true representation of the advisers. Keep up the good work!
the AFA and the FPA are in fantasy land if they think the changes are supported – the product manufacturers envisioned a way to recover profitability/ increase profitability and the IFA’s wear the brunt – nowhere do I see this helping the client / or more importantly the under-insurance problem.